PaperG Case Study Shows Effectiveness of Local Display

I first met PaperG CEO Victor Wong a few years ago before the launch of PaperG and PlaceLocal (the automated display ad creation tool). I must say he’s built a terrific business. Dex, among others, is using PaperG’s PlaceLocal tool with considerable success. However local display advertising is in general underutilized by national-local marketers and SMBs.

There are numerous studies and surveys that show local ads outperform more generic “national” ads, including in the context of online and mobile display. Adding to that, PaperG is out this morning with an interesting case study that shows how cost-effective local display can be vs. other media. It involves regional (Northeast) “quick service” restaurant chain Cheeseboy.

The company was promoting its second annual “Free Grilled Cheese day” and used PaperG to help publicize the event.

Cheeseboy had two goals: build awareness and drive new customers into stores. As the slide above indicates the company had never used display advertising and had only a $1,000 budget. Indeed, this is a case where paid search advertising might have had only limited success. There’s probably not much query volume for variations on the term “grilled cheese” except among people searching for recipes.

Cheeseboy used PlaceLocal to create customized versions of the ad above for each location. The company was, according to PaperG, able to target to within 15 miles of each store location. I always have questions about how accurate local display targeting is online. However in this case the campaign did reach lots of people apparently.

Here are the reported metrics:

700,000+ ad impressions

768 qualified clicks

$1.30 CPC

5,655 people showed up at stores

$2.00 on average was spent by each customer on extras during the event

I don’t have a copy of the landing page but I assume there was some sort of coupon customers were asked to present in order to track online-to-offline sales. The ad copy says “click to RSVP,” suggesting there was a coupon or something similar on the landing page. (Victor maybe you can clarify that.)

This is one potential challenge I see with automated display ad creation: while the ads look good the landing page needs to be able to generate the conversion or other desired action. That involves at least some work on somebody’s part — unless there’s already a reasonable landing page from a past campaign or set up for lead capture.

If 5,655 customers each spent at least $2.00 (on drinks, chips, etc), more than $11,000 in in-store sales were generated as a result of these ads. It’s not clear how many people were new customers but this appears to be a very successful campaign with only a $1,000 ad buy — just 7% of the company’s overall marketing budget and split with radio and Facebook.

Here are PaperG’s general CPM metrics comparing the cost of local online display with local radio and direct mail:

If PlaceLocal can team up with Facebook Ads that will be really interesting to see. City names in Facebook ads have been shown to boost CTRs by at least 2X over ads without locations in the creative.

Cheeseboy had set up a landing page for people who saw the online ads to RSVP for the event. They basically got an email reminder. At the event itself, people were asked by Cheeseboy employees how they heard about the event.

Facebook is another (important) display ad inventory source. We see display as one medium (and many sources: mobile, desktop, Facebook, etc.). We definitely are interested in expanding into Facebook but have been devoting a lot of our resources to online and mobile given all the demand we’re seeing there.

It is CPC which is competitive, if not cheaper in some cases, than most SMB search CPC costs.

For the Cheeseboy event, you could still participate and show up to the event without having RSVP’ed. The RSVP was an email reminder to show up to the event (and also served as a way to capture the email for future marketing). So all the people who saw the 700,000+ ad impressions could still get a free sandwich if they were only aware of the event and showed up but didn’t RSVP in advance. As a result, not all the people who attributed knowing about the event from online display ads necessarily clicked to sign up. Many could have seen the ad and simply showed up.

This confirms so much about what we know anecdotally about advertising on The Batavian.

Local display ads in local context are very effective.

But one of the key bits of information is in Victor’s last comment — that the greatest response came from people just SEEING the ad without clicking on it.

Ad impressions are far more important than clicks.

If you understand the nature of user intention and the entire scope of contextual advertising, it should be no surprise that local display ads in local context are highly effective. Yet, a lot of otherwise very smart people continue to criticize banner ads as a means of helping to fund local journalism.

[…] percent jump compared to the fourth quarter.PaperG Case Study Shows Effectiveness of Local Display (ScreenWerk) Greg Sterling: There are numerous studies and surveys that show local ads outperform more generic […]

[…] People have been talking for years about local search but PaperG wants to convey that there’s a significant opportunity with local display advertising. I agree, if it’s done correctly. Here’s a previously released case study from the company: PaperG Case Study Shows Effectiveness of Local Display. […]